Aifa has questioned the “value and role” of accredited bodies, saying the FSA’s professionalism rules will bring no consumer benefit for “substantial cost”.
The FSA’s policy statement on professionalism, published last week, confirms advisers will need a statement of professional standing to continue to offer advice from January 2013. Accredited bodies will be responsible for issuing advisers with the statements.
Aifa policy director Andrew Strange says: “We welcome the FSA’s clarity that much of the assessment of adviser competence will remain with firms. However, this does now call into question the value and role of accredited bodies. There is a substantial cost incurred by the industry for the production of the SPS.
“Aifa strongly supports measures to increase consumer trust through professionalism but we fear that these proposals will produce no consumer betterment, for substantial cost.”
Institute of Financial Planning chief executive Nick Cann says professional bodies need to agree a consistent approach to monitoring advisers.
Cann says: “Where we need clarification is the different stances that the different accredited bodies might take on verifying gap-filling. There may be a need for the professional bodies to come together to reach an agreement about what is consistent and what is acceptable. If we are thinking about the best interests of advisers more broadly, then I think a more joined-up conversation is helpful.”
Syndaxi Chartered Financial Planners managing director Robert Reid says: “It is not clear what kind of diligence is going to be applied to these accredited bodies. Advisers are effectively being forced to join a professional body, as membership costs absorb the cost of the SPS, and so the financial probity of these firms then becomes really important. If you are going to join a body you want to know it is going to stay around.”